The Wisconsin Trip Corporation is considering two locations for a water park.

The Racine location would require an investment of $$3$ million, and $$40,000$ per year to maintain, and will generate $$450,000$ in revenue per year.

The Lake Geneva location would cost $$5\mathrm{.}09$ million to construct, and $$60,000$ per year to maintain, but would generate $$750,000$ in revenue per year.

Assume that either water park will be maintained and operated indefinitely. Use an interest rate of $12\%$ per year to determine which location, if either, should be selected on the basis of:

$($a$)$ The B$/$C method. Solution: Choose Geneva

$($b$)$ The modified $\frac{B}{C}$ method $($with maintenance costs subtracted from the benefits, instead of added to the costs$).$

$($c$)$ Did both methods yield the same recommendation for the water park? If so$,$ did that surprise you? Why or why not?